Are you one of those who at the end of every month is broke?
Are you the one who doesn’t have a track of any of their expenses, no matter how little they are?
Then perhaps you don’t have a habit of preparing a budget.
For most of us, certain expenses are fixed, like rent of the house/ flat we live in, expense on essentials like grocery expense and paying other bills, a shopping spree and partying.
Since rent and household expense forms a major expense, most of us think that major chunk will be saved. However, this doesn’t happen.
And by the end of every month, we are broke!
You may think that you are not expending much, but actually, you are. Zero balance at the end of every month is proof of it.
Hence, preparing a budget is important and sticking to it is even more!
Further, the habit of saving will definitely help you In achieving long-term goals, although SIP investment will do it sooner!
SIP Investment is an investment in the equity and debt market through mutual funds. Any mutual fund scheme has a diversified portfolio. This not only reduces the risk of loss but also ensures you against market uncertainties.
Over the years, especially this generation has forgotten how to save money. They state reasons like high cost of living, rising inflation, etc. Hence, this generation is pretty convinced that “saving to ni ho paayegi”.
Hence, as a better alternative to saving, SIP investment comes into the picture.
The thing with mutual fund SIP investment is, the SIP amount gets automatically debited from your account at the pre-decided date. So, it not only instils discipline in you but also a habit of investing.
Further, you should follow the 50-30-20 rule.
The best thing about Mutual fund investment is, you don’t directly invest in the equity market. You’ll have a diversified portfolio.
Have a look at the following reasons, as why SIP Investment is any day a better and a profitable option than saving or equity and debt investments:
Apart from the technicalities involved, like completing your KYC, FATCA, and other things, what’s more important is that you should ask yourself why and how to about the entire process of investment.
Consider the following points:
Start early, save more
The sooner you start, the better it is. As mentioned above, the longer you stay invested, the better the returns you generate. Further, investing a few thousand bucks every month won’t be heavy on your pocket. Hence, start your SIP investment as soon as you get the first salary in your hand.
Periodically review all your SIP investments
This is perhaps the most important point to remember. You, with the help of your financial advisor or all by yourself, should periodically review your SIP Investment portfolio. This should happen every four to six months. You should continuously review so that your SIP investment remains aligned with your goals.
Avoid any liability for short-term gains
Credit cards and personal loans look pretty attractive in the short run. The EMI option looks simple and affordable, however, you end paying more than the price of the purchased product. It of no use to purchase an asset whose value degrades over time. It is recommended that one should not go for such loans and avoid excessive use of credit cards.
Go for a Financial Planner
It is any day recommended that you should go for a financial planner. You can Google out some Certified Financial Planners that can come to your aid for this purpose. One such Certified Financial Planner is Mr Mukesh Gupta. He is Fellow Chartered Accountant as well and director of Wealthcare Securities Pvt Ltd.